Law and Magic Blog

Yup, Probabilities

Consider deeply before drawing to an inside straight and never,never, never, never play any card game with a feline advantage player. They have twenty toes (more or less) and they are good at math. 

Courtesy Icanhascheezburger.com.

Security! Remove That Player! He's Counting Cards!

An investigation of the justifications for banning the technology behind card-counting devices, and the policies for banning card counters, from casinos.

Adam J. Kolber, Brooklyn Law School, Criminalizing Cognitive Enhancement at the Blackjack Table, in Memory and Law 307 (L. Nadel & W. Sinnott-Armstrong eds.; Oxford University Press, 2012).

Blackjack players who “count cards” keep track of cards that have already been played and use this knowledge to turn the probability of winning in their favor. Though casinos try to eject card counters or otherwise make their task more difficult, card counting is perfectly legal. So long as card counters rely on their own memory and computational skills, they have violated no laws and can make sizable profits. By contrast, if players use a “device” to help them count cards, like a calculator or smartphone, they have committed a serious crime.I consider two potential justifications for anti-device legislation and find both lacking. The first is that, unlike natural card counting, device-assisted card counting requires cognitive enhancement. It makes card counting less natural and is unfair to casinos and should therefore be prohibited. The second potential justification relies on the privacy of our thoughts. On this view, natural card counting is a kind of cheating that warrants punishment. We do not criminalize natural card counting, however, because such laws would interfere with our thought privacy. Since concerns about thought privacy are less applicable to device-assisted counting, we can prohibit device-assisted counting without violating our rights to freedom of mind. While I do not purport to show that these justifications are hopeless, I present reasons to doubt that they will ultimately prove successful.

Download the essay from SSRN at the link.

Skill, Chance, and Online Poker

Rogier J. D. Potter van Loon, Martijn J. Van den Assem, and Dennie Van Dolder, all of the Erasmus University Rotterdam, Erasmus School of Economics, have published Beyond Chance? The Persistence of Performance in Online Poker.

A major issue in the widespread controversy about the legality of poker and the appropriate taxation of winnings is whether poker should be considered a game of skill or a game of chance. To inform this debate we present an analysis into the role of skill in the performance of online poker players, using a large database with hundreds of millions of player-hand observations from real money ring games at three different stakes levels. We find that players whose earlier profitability was in the top (bottom) deciles perform better (worse) and are substantially more likely to end up in the top (bottom) performance deciles of the following time period. Regression analyses of performance on historical performance and other skill-related proxies provide further evidence for persistence and predictability. Our results suggest that skill is an important factor in online poker.

Download the paper from SSRN at the link.

Meanwhile, U. S. District Judge Jack Weinstein ruled in August that poker is a game of skill. In U.S. v. Dicristina, Judge Weinstein wrote, in part: 

[T]he burden is on the government to show that its interpretation of the IGBA is correct. Although many states, including New York, consider poker to fall within the common law definition of gambling as a game of chance, see Part II(B)(5), supra, this factor is not determinative in construing a federal statute. The government must demonstrate that it is more probable than not that poker is predominated by chance rather than skill. It has failed to do so.

The government acknowledges that skill plays a role in poker. Game play in poker is influenced by both the cards dealt (determined by chance) and the decisions made by players (determined by skill). While players' actions are influenced by chance events, their decisions are based on skill. Players' decisions, in turn, affect game play, both in the hand being played and in subsequent hands. By bluffing, for example, players can overcome the power of chance and win a hand despite holding inferior cards.

The majority of poker hands end when one player induces his opponents to fold. See PPA Mot. for Leave to File an Amicus Br. Ex. A (Paco Hope & Sean McCulloch, Statistical Analysis of Texas Hold'em 14 (Mar. 4, 2009) (unpublished article)), Doc. Entry 74, July 3, 2012. Since the cards are never revealed or compared, the players' decisions alone determine the outcome. Id. The ability of players to influence game play distinguishes poker from the other games, such as sports betting (bookmaking), enumerated in the IGBA.

That chance plays some role in the outcome of the game does not imply that poker is predominately a game of chance rather than predominately a game of skill. Chess, a game in which all possible moves are known in advance, can be characterized as a pure game of skill, see, e.g., Gov't Expert Daubert Hr'g Tr. 40:7-12, 40:19-21. In poker, by contrast, players cannot know what cards the "luck of the draw" will deal them. The same can be said of bridge, where the "luck of the draw" is an element in overall wins and losses. Chance also influences many sports, such as golf. ... ("[G]olf is a game in which it is impossible to guarantee that . . . an individual's ability will be the sole determinant of the outcome. For example, changes in the weather may produce harder greens and more head winds for the tournament leader than for his closest pursuers. A lucky bounce may save a shot or two. . . . [C]hance may have a[n] . . . impact on the outcome of elite golf tournaments."). Yet no one would dispute that bridge and golf are games of skill.

The fundamental question is not whether some chance or skill is involved in poker, but what element predominates. To predominate, skill must account for a greater percentage of the outcome than chance—i.e., more than fifty percent.

...

The conclusion that poker is predominately a game of skill does not undermine the holding that poker is gambling as defined by New York law. While both New York State law and the IGBA require that a game involves chance, each apply different standards in determining whether a particular game is a game of chance or a game of skill. ... The test under the federal statute is one of preponderance, not material degree.

...

Because the poker played on the defendant's premises is not predominately a game of chance, it is not gambling as defined by the IGBA. That the statute was targeted at limiting the influence of organized crime, and organized crime groups have operated poker games beginning in the years since its passage, does not retroactively change the statute's scope. "The statute should not be extended . . . simply because it may seem to us that a similar policy applies, or upon the speculation that if the legislature had thought of it, very likely broader words would have been used." ...

As already noted, the IGBA is not the only tool available for the federal and state governments to prosecute organized crime involvement in poker games. If the Mafia operates such a game in an unlawful fashion (such as by also engaging in related loan sharking, extortion, or money laundering), the organizers and operators can be prosecuted under RICO.... It is notable that no such evidence was present in this case. Illustrations in the government's brief of federal poker prosecutions appear to be for racketeering under that statute. 

Even without the organized crime connection, this defendant's operations were necessarily and properly found by the jury to violate New York state gambling laws. He could have been prosecuted in state court by the Richmond County District Attorneys Office.

...

Neither the text of the IGBA nor its legislative history demonstrate that Congress designed the statute to cover all state gambling offenses. Nor does the definition of "gambling" include games, such as poker, which are predominated by skill. The rule of lenity compels a narrow reading of the IGBA, and dismissal of defendant's conviction.

A reversal of this decision and reinstatement of the jury verdict by the Court of Appeals for the Second Circuit would not violate the defendant's Double Jeopardy rights. 

...
The indictment is dismissed. The jury verdict is set aside.

 

Wheel of Fortune and Magic Wands

Zach, who attends Reed College, had the chance to win a new car in the bonus round on Wheel of Fortune by guessing the magic phrase, which was "Magic Wand." He tried everything else, and got the right one at the buzzer, but he didn't pronounce the phrase correctly. Oh, well. He didn't get the Prius, but he did win over $19,000 during the regular part of the show. At least he didn't land on the $100,000 spot on the wheel. Now, that would have been a bitter pill. More coverage here from the Daily Mail.

At it turns out, the WoF people have used the phrase in the bonus round before. Loyola of New Orleans College of Law student Plezetta West won over $120,000 by correctly solving the puzzle, which was, yes, "magic wand." She told her law school public affairs office she had practiced for her appearance on the show, but that wouldn't have mattered if "the WHEEL was not on my side.” A great law and magic story. 

"Ouija" Movie--Yes?

Universal Studios, which had apparently said "goodbye" to plans last summer to make a movie based on the popular Ouija board game, owned by Hasbro, seems to be back in the game. The Hollywood Reporter notes that the studio plans to have a film centering on the popular entertainment medium in theaters by 2013. Hmmm...auspicious year? Only the spirits know.

Oddly Winning

So, the Daily Mail has revealed that Joan R. Ginther, a woman who has won the Texas lottery four (4) times, isn't just lucky. She has a Stanford PhD (in statistics) and once taught math. According to a University of Nevada prof, she could have figured out, from information on the ticket, or from external information, which tickets were likely to be winners. The Texas lottery commission seems unfazed, saying she's just lucky, and people in the town where she bought her tickets thinks God must have smiled on her. In any case, she doesn't seem to have done anything odd except won a whole lot of money against the odds, perhaps by using her education and critical thinking. I like those odds, a lot.

More here in a Harper's article by Nathaniel Rich (readable text available only to subscribers, however).

Internet Gaming and Federal Law

Ron Rychlak, University of Mississippi School of Law, proposes a solution to the problem of banning (or regulating) Internet gaming, in a new article at 80 Mississippi Law Journal 1299 (2011). Here's the abstract.

In 2009, federal legislation went into place that essentially prohibited online gambling by prohibiting American financial institutions from facilitating cash transfers to and from Internet gambling sites. Unfortunately, due to jurisdictional limitations and the creativity of gaming operators, this new law is unlikely to meet the needs of American lawmakers. In fact, most of the attempts to prohibit or regulate Internet gambling have failed, and - by the very nature of the industry - are doomed to fail. This paper proposes a market-based solution that provides gamblers with a fair game, reduces social costs of online gambling, and provides gaming operators, both from within and outside of this nation, the ability to run a well-regulated online business. Legal, unregulated web pages will still be available, but regulated sites will provide competition that may run most crooked operations out of business.

Download the full text from SSRN at the link.

Supremes Magic Deck

From 2006: Supreme Court Magic Cards, via the I Fought the Law Blog. Where do people get these ideas?

According to the "about" page, this blog includes pictures of cats. Where are they? I found a picture of a doughnut with sprinkles, but no cats. FALSE ADVERTISING! 

Update: Here's a cat picture. She's black and white, suitably attired for an evening performance--must be a magic cat.

States Add Sales Taxes To Ramp Up Revenue--And Some Are Truly Magic

Some states are considering new sales taxes to increase revenues. But seriously. Think a minute, folks. Will some of these ideas really rake in the bucks?

Consider New York's imposition of sales tax on haunted house admissions: yup, if you charge more than 10 cents on tickets to your haunted house masterpiece, you'll have to collect sales tax on those prices, and fork it over to Governor Cuomo's administration.

Washington state voters dumped the short-lived candy tax intended to make up some of the deficit and passed in June last November; it was really confusing. Kit Kats weren't candy (they had some flour in them) but Reese's Peanut Butter Cups were (boo!). Meanwhile, Kentucky has a similar tax provision.

Alabama tacks a dime's worth of tax onto the price of every deck of cards with "no more than 54 cards" in it. So if you want to escape that dime, find a manufacturer who packages its decks with 55 cards (try out that novelty "Iraqi most wanted deck," for example).

While, this last link has nothing to do with sales taxes, it does have to do with tax season, and deductiblity. James Maule, of the blog Mauled Again, discusses the deductibility of Halloween costumes, and indulges in some wonderfully painful puns along the way.

 

Designing Casinos

Did you think casinos were designed off the cuff? Or that their magnificence was the result of some kind of drug-infused magical memories on the part of an architect or interior designer? Probably not, since in spite of their carefully chosen "themes," these game palaces seem to resemble one another in so many ways. Here's an article that investigates one theory behind the bright lights and loud noises intended to separate you from your cash as pleasantly as possible.

Emir Aly Crowne-Mohammed, Mohammed Hashim, Do the Friedman International Standards of Casino Design Apply to Canada? 3(2) Canadian Gaming Lawyer Magazine (2010) (no paging provided). Here is the abstract.

I continue my exploration of gaming law by examining casino design. I will argue that in Canada – where gaming is under the rigid monopolistic control of the Provincial Governments – that casino design may be as much of a legal question as it is a psychological and architectural issue.

When it comes to casino design, there are two models that ‘dominate’ the landscape. The model proposed by David Krane argues that casinos should be designed like ‘adult playgrounds. In this model, the comfort and ‘homely’ feeling of a casino is emphasized, as is open spaces, high ceilings, water and vegetation. In contrast, the Friedman International Standards of Casino Design focus on player counts and utilitarian features. In this model, the design and layout of the gaming machines and tables is central. Low ceilings, congested gaming equipment, short sight lines and narrow, winding aisles (that lead to isolated, intimate playing areas) are key. Ontario casinos are said to be a blend of the Krane and Friedman design principles. In this article, I explore the viability of a Canadian casino that is designed largely on the Friedman Design Principles, and suggest that many of these “international standards” or “winning principles” may not apply in Canada. And unlike George Costanza from Seinfeld, I feign no expertise in architecture (although I did have a passing interest in marine biology at one time).

Download the full text from SSRN at the link.